Financial Performance - Sales revenue increased by approximately RMB 3,185.3 million or 84.3% to approximately RMB 6,963.9 million compared to RMB 3,778.6 million in the same period last year[4]. - EBITDA decreased from approximately RMB 364.2 million in the first half of 2018 to approximately RMB 84.8 million in the first half of 2019, a reduction of approximately RMB 279.4 million[5]. - The loss attributable to equity holders was approximately RMB 164.0 million in the first half of 2019, compared to a profit of approximately RMB 191.0 million in the same period last year[10]. - Gross profit decreased from RMB 669.3 million to RMB 507.0 million, a decline of approximately 24.2%[10]. - Total sales revenue for the six months ended June 30, 2019, was RMB 6,908,267 thousand, an increase from RMB 3,700,334 thousand in the same period of 2018, representing an increase of approximately 86.7%[61]. - Operating loss for the period was RMB (86,023) thousand, compared to an operating profit of RMB 267,217 thousand in the same period of 2018, indicating a significant decline[61]. - Net loss attributable to equity holders for the period was RMB (163,964) thousand, compared to a profit of RMB 190,958 thousand in the same period of 2018, reflecting a negative turnaround[63]. - The company reported a total loss of RMB 169,195 thousand for the period ending June 30, 2019[68]. - The company reported a basic loss per share of RMB (0.1463) for the period, compared to earnings per share of RMB 0.1708 in the same period of 2018[63]. Revenue Segmentation - Approximately 87.8% of the company's revenue in the first half of 2019 came from the Smart Industry segment, while 5.8% was from the Technology New Retail segment[23]. - The technology new retail segment generated sales revenue of RMB 400,882 thousand for the six months ended June 30, 2019, up from RMB 270,175 thousand in the same period of 2018[133]. - The smart industry segment reported sales revenue of RMB 6,110,523 thousand for the six months ended June 30, 2019, compared to RMB 3,052,234 thousand in the previous year[134]. - The platform and enterprise services segment achieved sales revenue of RMB 442,087 thousand for the six months ended June 30, 2019, an increase from RMB 386,083 thousand in 2018[134]. - The O2O business exhibition center segment recorded sales revenue of RMB 10,408 thousand for the six months ended June 30, 2019, compared to RMB 70,130 thousand in the same period of 2018[134]. Goodwill and Impairment - The company recorded goodwill impairment losses of RMB 76.2 million due to underperformance in two operating segments[10]. - The company recognized goodwill impairment of RMB 38,426 thousand and RMB 37,776 thousand for two cash-generating units due to challenges in the garment services internet environment and a declining trend in the automotive industry[76]. - The goodwill impairment loss recognized for the internet services - garment industry was RMB 38,426,000 for the six months ended June 30, 2019, due to a decline in the recoverable amount[159]. - The goodwill impairment loss for the integrated marketing and advertising services was RMB 37,776,000 for the six months ended June 30, 2019, attributed to a decline in the automotive industry[162]. Strategic Initiatives - The company aims to become a leading "industrial internet" group in China, focusing on improving industry efficiency and empowering supply chains[11]. - The company has integrated resources from Zhongguancun Online, Rongshang Tonglian, and Home Appliance Exchange to enhance capabilities in media influence, SaaS, and supply chain[16]. - The company plans to continue investing resources to advance its industrial internet strategy and improve transaction scenarios[10]. - The strategic partnership with Tencent Cloud aims to enhance product development and market promotion, leveraging AI and IoT technologies[21]. - The company has entered into a cooperation agreement with the Daya Bay Development Zone Management Committee and other partners, indicating a strategic move for future expansion[76]. Financial Position - As of June 30, 2019, the group's cash and bank balances were approximately RMB 430.4 million, with net current assets of about RMB 1,374.3 million, indicating sufficient operating capital[28]. - Total borrowings as of June 30, 2019, amounted to RMB 2,395,985,000, an increase from RMB 2,127,338,000 as of December 31, 2018, with an average interest rate of 6.11%[29]. - The group's debt-to-equity ratio stood at 28% as of June 30, 2019, reflecting a net debt position[29]. - The group's equity attributable to shareholders decreased from RMB 4,337.7 million as of December 31, 2018, to RMB 4,210.0 million as of June 30, 2019, a reduction of RMB 127.7 million[30]. - The group employed 2,686 staff as of June 30, 2019, with employee compensation aligned with market trends[34]. Cash Flow and Investments - The net cash used in operating activities for the six months ended June 30, 2019, was RMB (150,256) thousand, compared to RMB (220,359) thousand for the same period in 2018, indicating a 31.7% improvement[74]. - The net cash generated from investing activities was RMB (111,383) thousand for the six months ended June 30, 2019, compared to RMB 110,953 thousand for the same period in 2018, reflecting a significant change in investment strategy[74]. - The net cash generated from financing activities was RMB 220,343 thousand, with a net decrease in cash and cash equivalents of RMB (41,296) thousand, compared to a net cash generated of RMB 108,886 thousand and a decrease of RMB (520) thousand in 2018[74]. - The total cash and cash equivalents at the end of the period was RMB 430,423 thousand, up from RMB 401,757 thousand at the end of the same period in 2018, representing a 7.1% increase[74]. Shareholder Actions - The group issued 450,000 shares under its share option plan during the six months ended June 30, 2019, and repurchased 1,100,000 shares, which have not yet been cancelled[35]. - The company approved an updated stock option plan allowing for the issuance of up to 112,085,221 shares, which is 10% of the total issued share capital as of the special general meeting[48]. - The board granted 10,000,000 stock options to the CEO at an exercise price of HKD 4.6 per share, pending acceptance[52]. - The company updated its employee share incentive plan, allowing for the issuance of up to 56,000,000 reward shares, which is 5% of the total issued share capital as of July 8, 2019[54]. - A total of 28,100,000 reward shares were granted to 26 selected employees, representing approximately 2.51% of the total issued share capital, including 4,000,000 shares to the CEO[54]. Accounting and Reporting Changes - The company has adopted new accounting standards, including HKFRS 16 on leases, which may impact financial reporting and cash flow management[80]. - The adoption of Hong Kong Financial Reporting Standard 16 resulted in a lease liability of RMB 163,310, with current lease liabilities at RMB 70,714 and non-current lease liabilities at RMB 92,596[84]. - The impact of adopting Hong Kong Financial Reporting Standard 16 led to a decrease in earnings per share by RMB 0.34 for the six months ended June 30, 2019[98]. - The company has opted for a simplified transition approach under the new standard, with no restatement of comparative figures for the fiscal year 2018[84]. Risk Management - The company does not face significant foreign exchange risks as most of its assets and liabilities are denominated in RMB[38]. - The company has no significant concentration of credit risk in accounts receivable due to a diverse customer base across China[169]. - The company’s financial risk management policies have remained unchanged since the end of the fiscal year[110].

Financial Performance - The Group achieved revenue of over RMB 10 billion for the year 2018, representing an increase of 185.8% compared to the same period last year[13]. - In 2018, the company achieved a revenue of RMB 10,583,111, representing a 185.8% increase from RMB 3,702,466 in 2017[30]. - For the financial year ended December 31, 2018, the Group generated total revenue of approximately RMB10,583,111,000, representing an increase of approximately 185.8% compared to RMB3,702,466,000 in 2017[35]. - EBITDA for 2018 was RMB 641,212, slightly down from RMB 653,075 in 2017[23]. - Profit attributable to equity holders of the company was RMB 275,610, a marginal increase from RMB 267,777 in 2017[23]. - The Group achieved a profit for the year of approximately RMB276,875,000 in 2018, a decrease from RMB317,310,000 in 2017, mainly due to increased share-based compensation expenses[35]. - The Group's operating expenses increased from approximately RMB1,012,537,000 in 2017 to approximately RMB1,173,887,000 in 2018, primarily due to an increase in share-based compensation expenses[35]. Business Expansion and Structure - As of December 31, 2018, the Group expanded its business to more than 100 cities nationwide, with branches established in over ten cities and a service team of around 2,778 individuals[13]. - The Group's new business structure established three business groups: technology-driven new retail, smart industries, and platform and corporate services[13]. - The Group's transformation towards industrial internet began at the end of 2017, with a new vision to become a leading industrial internet group in China[13]. - The smart industries business group is expected to bring more surprises in 2019 following significant progress in 2018[18]. - The platform and corporate services group aims to empower SMEs through industrial internet tools and value-added services[16]. - The structural adjustment in the organization is believed to lay a foundation for faster and more efficient development in 2019[19]. Revenue Breakdown by Segment - Revenue from the smart industries segment increased from approximately RMB2,154,579,000 in 2017 to approximately RMB9,211,537,000 in 2018, which represented an increase of approximately 327.5%[35]. - The technology-driven new retail segment achieved total revenue of approximately RMB557,875,000 in 2018, an increase of approximately 35.4% from RMB411,909,000 in 2017[35]. - Revenue from the platform and corporate services segment was approximately RMB727,563,000 in 2018, representing an increase of approximately 3.5% from RMB702,881,000 in 2017[35]. - Revenue from the O2O business exhibition centre decreased by approximately 80% to RMB86,136,000 in 2018 from RMB433,097,000 in 2017 due to a decline in property sales[35]. - In 2018, approximately 5.3% of the Group's revenue came from its technology-driven new retail business, while approximately 87.0% was from smart industries, 6.9% from platform and corporate services, and 0.8% from the O2O business exhibition center[85]. Strategic Initiatives and Collaborations - The Group announced a strategic cooperation with Tencent CCM on December 26, 2018, to jointly develop products and engage in marketing efforts utilizing AI and IoT technologies[76]. - The Group signed a strategic cooperation agreement with Tencent Cloud at the end of 2018 to develop industrial internet tools aimed at improving efficiency for SMEs[98]. - The collaboration with Shanghai Unicom and Tsinghua University in June 2018 aims to enhance big data applications and model construction for the Group[84]. - The Group aims to empower traditional industries through advanced technologies such as SaaS, IoT, and big data, enhancing efficiency and competitiveness[88]. Management and Governance - Liu Jun has been appointed as an executive Director since September 12, 2016, and has been the senior vice president of the Group since July 2016[103]. - Liu Xiaodong was appointed as an executive Director on June 1, 2018, and has over 19 years of experience in media operation and management in the TMT field[103]. - Lee Wee Ong, aged 49, has served as the chief financial officer since 2011 and was redesignated as an executive Director in July 2012[105]. - Guo Fansheng, aged 63, founded the Group in October 1992 and is responsible for its overall strategic development[105]. - Mr. Zhang was appointed as the CEO of the Company effective January 4, 2019, after serving as co-president[117]. Financial Position and Liabilities - Total assets increased to RMB 8,767,955 in 2018 from RMB 7,334,553 in 2017[23]. - Total liabilities rose to RMB 3,546,331 in 2018, up from RMB 2,877,424 in 2017[23]. - The Group's cash and cash equivalents increased by approximately RMB 69,754,000 to approximately RMB 471,672,000, with about 85% denominated in RMB[130]. - Total borrowings amounted to approximately RMB 2,254,900,000 as of December 31, 2018, representing a 47% increase from RMB 1,538,517,000 in 2017, primarily for refinancing purposes[130]. - The Group's gearing ratio was 22% as of December 31, 2018, compared to 20% in 2017, calculated as net debt divided by total capital[130]. Risks and Regulatory Compliance - The Group relies on HC Contractual Arrangements for its online services due to PRC laws restricting foreign participation in internet content services[132]. - The Group's ability to conduct online business could be materially affected if the PRC government determines that the HC Contractual Arrangements do not comply with applicable laws[186]. - There is a risk that the HC Contractual Arrangements may not provide control as effective as direct ownership, potentially leading to substantial litigation costs if obligations are not met[193]. - The Group's financial results could be adversely affected if it loses the right to direct the activities of Huicong Construction due to the consequences of regulatory actions[190].